Global Shift of Labor Markets
In this age of globalization and economic integration, international companies face many complex issues. One of these issues has arisen rather quickly this past decade and will affect many businesses in the years to come. Companies around the world now face the problem of a global shift in the supply and demand of talent. Due to an aging population, global employers face the challenge of recruiting from a shrinking workforce. More specifically, as the skills employers require become more complex, labor shortages are probable in many mature markets such as the United States, Italy, Canada, and Germany. Already, an estimated 31% of employers worldwide find it difficult to fill positions because of talent shortages in their markets. So what does this mean for the future of business?
Due to shifts in labor demographics and the increased need for high skilled workers, employment opportunities are arising in markets overseas where the need for work is more prominent. This has caused the talent market to become increasingly global and mobile. Talented workers can now explore career opportunities abroad and do so with greater ease as markets become more integrated and developed. Also, the dramatic growth of emerging markets has encouraged migration to these markets among high skilled workers. Although developed markets are still a top choice for economic migrants, many workers are considering growth opportunities in these emerging markets. It’s now more important than ever for workers to be globally aware so they can take advantage of job prospects overseas.
The demographic divide created by an aging population is not only causing workers to go abroad, it is also causing businesses to consider international opportunities. For example, Japan has more people exiting the workforce than there are workers prepared to join the labor pool. This has caused Japan’s second-largest shipbuilding company to expand in the Philippines, where workers are on average half the age of its Japanese employees. This is happening in many Asian countries as Japan, South Korea, and China are among the fastest-aging countries in the world, while developing nations in Southeast Asia are overflowing with a young workforce. Due to labor shortages, a trend has started where businesses are expanding to markets with a large supply of skilled workers as seen with the shipbuilding company in Japan.
As labor markets change due to population shifts, it’s extremely important that there are workers available to fill any shortages. Without any workers, productivity would be lost and perhaps more importantly, global economic growth would falter. However, with a more interconnected world, countries teeming with a young skilled workforce will be able to help markets in need of labor. Therefore, the importance of global awareness among workers cannot be emphasized enough in this day and age of shifting demographics.